Yen exchange rate today
According to Lao Dong, on September 25, the USD/JPY pair increased to nearly 148.80, the highest level in three weeks, thanks to the USD strengthening against the Japanese Yen.
The main reasons come from the wave of risk concerns in the global financial market and the cautious stance of the US Federal Reserve (Fed).
On September 23, Fed Chairman Jerome Powell said the central bank needs to continue to balance the risk of high inflation and a weak job market in upcoming decisions.
He emphasized that interest rates are currently at "good" levels to deal with both risks, implying that it is not necessary to cut interest rates sharply. This position has strengthened the strength of the greenback.
Fed forecasts interest rate cuts, JPY still plummets
According to FXStreet, the Fed is expected to make two interest rate cuts, each of 0.25 percentage points in the remaining two meetings this year, along with another cut in the first quarter of 2026, in line with the policy orientation given after the recent meeting.
On the other hand, the Yen was under pressure when the Japanese manufacturing PMI index in September announced by S&P Global decreased the most in six months, showing that industrial activities continued to weaken.
In addition, concerns about political instability ahead of the October 4 election for the leadership of the Liberal Democratic Party (LDP) could prompt the Bank of Japan (BoJ) to delay raising interest rates. This further increases the downward pressure on the JPY.
In the short term, investors will be watching the minutes of the BoJ meeting and the final GDP figures for the second quarter of the US, scheduled to be released on September 25. Any signs of weakness from the US economy could weaken the USD's strength, thereby supporting the Japanese Yen.
